Problem 4.9. High Low, Profit Equation [Lo 2] Rhetorix, Inc. produces stereo speakers. Each unit (a pair of speakers) sells for $900. Below is information on production/sales and costs for 2010.
Production and sales in unit productn costs Selling and Admin Costs
January 105 $88,860 $23,570
February 117 $97,600 $25,200
March 95 $83,007 $22,495
April 106 $89,600 $23,720
May 115 $96,200 $24,950
June 125 $103,500 $26,250
July 128 $105,670 $26,690
August 132 $108,550 $27,200
September 138 $112,978 $28,030
October 126 $104,200 $26,400
November 124 $102,750 $26,150
December 108 $91,050 $23,900
Total 1421 $1,183,965 $304,645
Average cost per unit $83,319,141 $21,438,776
“B. The company estimates that production and sales in 2011 will be 1,550 units. Based on this estimate, forecast income before taxes for 2011.